Deloitte’s Center for Board Effectiveness and the ABD Unveil New Industry Data From the Missing Pieces Report

New Data Highlights Deloitte Board Diversity for Industry Centric Companies in the Categories of Consumer; Energy, Resources, and Industrials; Financial Services; Life Sciences and Health Care; And Technology, Media and Telecommunications.

Looking at boardroom diversity, through an industry lens, technology, media, and communications (42% of companies within that industry) and life sciences and health care (38% of companies within that industry) companies have the greatest percentage of boardroom diversity according to new data from the “Missing Pieces Report,” a multiyear study published by the Alliance for Board Diversity (ABD), in collaboration with Deloitte.

Since launching “Missing Pieces Report: The 2018 Board Diversity Census of Women and Minorities on Deloitte Fortune 500 Boards,” last year, the Alliance for Board Diversity and Deloitte have examined the data from another angle taking a look at the Fortune 500 in alignment with their respective industries, which are classified as: consumer; energy, resources and industrials; financial services; life sciences and health care; and technology, media and telecommunications. Industries leading in having boards with greater than 40% diversity include: technology, media and telecommunications (42% of companies within that industry); and life sciences and health care (38% of companies within that industry).

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“Steady progress has been made over the years with diversity being linked to greater innovation, better financial outcomes and increased transparency by Fortune 500 companies. The industry data allows for a deeper understanding of untapped opportunities to increase diversity in the boardroom,” said Deb DeHaas, vice chairman and national managing partner, Deloitte Center for Board Effectiveness. “While increases in boardroom diversity over the last two years are encouraging, there is still much more work to be done.”

Viewing the numbers by industry allows for a deeper conversation about where headway has been made and where there are more opportunities for diversity in the boardroom. Key findings for the Fortune 500 include:

• Technology, media and telecommunications (42% of companies within that industry) lead all industries in having boards with greater than 40% diversity. They are followed by life sciences and health care (38% of companies within that industry). Energy, resources and industrials companies have an opportunity to increase board diversity from the current rate of 20%.
• The percentage of board seats held by minority men is strongest in the life sciences and health care industry (15%).
• The percentage of board seats held by minority women is strongest (6%) in the consumer industry, followed closely by technology, media and telecommunications (5.8%). Conversely, minority women held 3.8% of board seats with financial services; 3.6% with energy, resources, and industrials; and 2.5% in the life sciences and health care industry.
• Minorities in the technology, media and telecommunications industry hold more board seats than Caucasian/White women (18.8% versus 17.2%).
• Across all industries, African American/Black directors hold the largest percentage of board seats among all minorities, and they have a particularly strong representation in life sciences and health care (10.1%), followed closely by financial services (9.6%).
• With Caucasian/White people holding more than 80% of the total number of board seats in the Fortune 500 in each industry, there’s an opportunity to increase diversity in the boardroom.

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Though the pace of change is still slow in relation to shifting demographics in the U.S., when the “Missing Pieces Report: The 2018 Board Diversity Census of Women and Minorities on Fortune 500 Boards,” was released, the number of Fortune 500 companies with greater than 40% of board members who are women and/or minorities has nearly tripled since 2010. Looking at boardroom diversity through the industry lens may spark additional conversation on where specific progress is happening and where there is opportunity for more work to be done.

“As companies face industry disruption, cyber risk, regulatory uncertainty, and more, they will need to leverage the board as a strategic asset in navigating a complex business environment. There is a valuable opportunity for forward-looking boards to embrace the wide range of skills, experiences, and perspectives diversity brings,” said Linda Akutagawa, chair for the Alliance for Board Diversity and president and CEO, LEAP (Leadership Education for Asian Pacifics). “Taking a broader look at diversity and what those candidates bring to the boardroom could provide organizations with a competitive edge.”

As reported when the Missing Pieces data was released on Jan. 16, 2019, Fortune 500 board representation of women and minorities saw an all-time high at 34% (1,929 board seats), compared to 30.8% in 2016 (1,677 board seats) — Total minority representation also increased to 16.1% (912 board seats) from 12.8% in 2010, the first year Fortune 500 data was captured. Other key findings for the Fortune 500 include:

• African American/Black women gained 32 seats in 2018, an increase of 26.2% from 2016. African American/Black men gained 26 seats in 2018, an increase of 8.5% from 2016.
• Hispanic/Latino men gained 21 seats in 2018, an increase of 14.3% from 2016. Hispanic/Latina women gained four seats in 2018, an increase of 9.8% from 2016.
• Asian/Pacific Islander men gained 25 seats in 2018, an increase of 20.3% from 2016. Asian/Pacific Islander women gained 17 seats, an increase of 38.6% from 2016.

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